Champ Car owners committed to series long-term success
by Mark Cipolloni

 September 1, 2007

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Kevin Kalkhoven
Bob Heathcote

On the heels of the cancellation of both the China and Phoenix races this week and the resulting negative backlash that has caused, Champ Car Series owners Kevin Kalkhoven, Dan Pettit, Paul Gentilozzi, plus series President Steve Johnson and Series VP of Communications David Higdon met with a few media members and I to discuss the state of Champ Car and to ease fears that the sky is falling.

Champ Car President Steve Johnson started out addressing the most recent issue at hand, the cancelled Phoenix race.

"Obviously an event occurred last week that kind of caught us all by surprise, and that was Phoenix," said Johnson. 

"There's a lot of rumors going on. But the bottom line to Phoenix was the costs far exceeded the revenues for the event, and therefore they didn't see it as a viable economic reason to continue with the event.

"A lot of things came into play with that, but we supported their decision when they came to us with it. This doesn't affect Vegas. This is just the Phoenix event that has been canceled.

"We're not replacing it. We're not throwing an event on at the last minute to end the season because, first off, it wouldn't be properly done and we're not going to go race just to race. So Phoenix is off the calendar. It was as disappointing to us as it was to everybody, but unfortunately sometimes those things happen in business.

"We're going to focus on having 14 great events this year. We've had very strong events this year. We've had good racing, great crowds, and we're going to finish up the season that way with Australia and then Mexico. So we will end the season in Mexico City this year."

But how does Champ Car get around the fact that it is a bit of a PR disaster to have five canceled races in three years?

"Us. At the end of the day that's who is responsible for it," said Johnson.

"As we're doing our 2008 calendar right now, we're going to pick the events, make sure the FIA approvals are in, the promoters are strong, do our best so that doesn't happen again. It not good for any of us. It's bad for the teams, bad for the other venues, bad for the series. It's not acceptable to us.

"We're putting together a schedule where that will not happen in the future."

Is Phoenix off for good, forever?

"Well, never say "forever," but it's not going to be on the 2008 calendar right now," Johnson iterated.

"We have to submit next year's schedule to the FIA for approval, especially with the international events. We know what happened in China. People told us it was not a money issue at all. We couldn't get the date changed, couldn't get that through the FIA. They acted within their areas of authority.

"Unfortunately that happened to us. So we're going to follow the proper procedures, get the schedule in on the calendar to the council and have them approve our dates for next year.

"It goes to the FIA mid-October. When we put out a provisional calendar, I'm not sure yet. We may have to say, Here is this year's events, pending FIA approval."

There's been a lot of challenge in getting off the ground in Korea and China. At some point do you kind of have to give up and move on?

"China, actually we had a promoter, we had the funding, we had a racetrack, we had the promotions. We didn't have an FIA approval. If we had that, we'd be going there," said Johnson.

"We're going to be going back. We're working with them to get that back on the calendar for 2008. We have a meeting with them in two weeks to finalize everything with them. We know we had the May listing. They did approve that. Then we had a change of promoters and they wouldn't approve the October listing, so...

"Korea was totally different. Didn't even have a racetrack."

As to how many races for the 2008 schedule, "we're looking at around 15," said Johnson

Has that whole process over the China thing had a sobering lesson in just what the power of the FIA is ultimately? Not that you didn't know that before.

"We've always known the power, said Gentilozzi.  We didn't anticipate, necessarily, their desire to follow guidelines. They're very structured. Honestly, they had a very valid point. It's their rules. If we're going to race internationally, we have to abide by their rules.

"I think sometimes in the U.S. we don't understand we're more willing to compromise than the rest of the world. Here they tell you to get in line. Get in line, don't get out of line. In the U.S. we're always trying to cut the line."

They reiterated the fact that support for Champ Car outside the USA is surprisingly strong.

"I think Holland created a truly wonderful event," said Kalkhoven I believe tomorrow we're going to see an extraordinary event, I really do. The enthusiasm of the Europeans for our racing is remarkable. Plus having Doornbos."

"I think you see that in the media room," said Kalkhoven.  "It's just packed. That isn't necessarily projected back to the U.S. They just don't understand here there is a passionate enthusiasm. They find our racing compelling, open access. These guys are all over-praising what we do."

"We've worked this market hard," added Johnson.  "You (David Malsher) were with us when we did the European media tour. That was a tremendous amount of success. That was a great way to launch Champ Car into Europe. We have a great promoter. You go into the restaurants. Every restaurant has posters up. Everybody's talking about Champ Car. That doesn't happen in every market we go to.

"We had a great dinner just off the square in Amsterdam. The waiter knew everything about Champ Car, knew all the drivers, said anybody should win but Sebastien. He was Belgian."
"It tells us that there is a passion for open-wheel racing and our style of racing here in Euro," said Kalkhoven.  "I think we underestimate the popularity of our racing here in Europe, I really do.

"I mean, I was shocked when a cabdriver talked about that in St. Petersburg, Russia. You know, he watched Surfers on television. Wanted to know if he could go to Surfers. How would he go to Surfers, a fabulous place. He just wanted to talk about it. That's just a cabdriver."

So what is Champ Car's future? Is it more international, more non-U.S.? Given NASCAR's strength and dominance in America, the low TV ratings in America, some soft markets in America, not a lot of corporate support in America, what's the future for Champ Car? Is it going to become more international?

"It's called the World Series, Champ Car World Series. We did that on day one," said Kalkhoven.

"I think Steve and his staff have been trying to go that way," added Gentilozzi. "It isn't easy to break new ground. It isn't easy to be in China or Korea. It's tough. Eventually if we can break through with perseverance, there may be several new markets.

"Champ Car used to go to Brazil, South America. Now, the difference is they have a stock car series like NASCAR there. We don't have that here in Europe. It's not what the people want, not what the fans want."

"The same is also true in Asia," added Kalkhoven.  "It may be we batted our heads against brick walls in Asia, but eventually the walls will give way because our heads are pretty solid (laughter). That is a market that is huge, and it is one that is fascinated by our style of racing. I mean, there's no doubt about it.

Formula One is Formula One. I pointed out Everybody knows Formula One. You can go to a country and race there without a local driver. Here we have Doornbos, his popularity is helping the promoter. How do you go to Asia, given that Champ Car really doesn't have that big of a name in Asia, and be successful? What is going to make it work?

"It's going to take time," said Kalkhoven.

"The other side of that is they don't have auto racing, so any auto racing is unique and new," said Gentilozzi.  "It takes time to develop drivers. There are Asian drivers certainly in the world, and there are more every year. But to go to that market, once we've proven we can race there - and you have to understand they're very skeptical - once we've proven we can race there, provide a good product, then corporate support will come.

"When that comes, the same way that Brazilian drivers got into Champ Car, Brazilian sponsors brought them with them. So we have to go there first. We can't say, Sponsor a driver and we'll come race there."

"My experience in Asia, which goes back to my previous job, is that those areas of the country are looking for excellence in sports," said David Higdon.  "They don't really get into the whole nationalism like Europe does. So, for instance, men's tennis went into Asia with no Asian players whatsoever.

"They just wanted -- you know, they wanted top-line sports. That's why I think Champ Car will be successful there."

"We took Roberto Moreno over there. We had to have 10,000 to 15,000 people show up," Johnson pointed out. "That may be underestimating the number, to watch one car go around the circuit. I've been there three times. There's a lot of interest. There is a lot of support from the local government there, the promoter. The racetrack is a great facility. They know how to promote. They have the GT series that goes there. I think it's going to be successful. I don't consider it being soft at all."

There's no question the product is good, the racing is good. What seems to be lacking from where I sit is, the marketing, and as I've said a lot of times, the big stars. From my perspective, Montoya, Villeneuve, Scott Speed, Tony Stewart, Sam Hornish, should not be in NASCAR. All those big names need to be in open-wheel racing, in my opinion.

"I don't think you can stop the train called NASCAR," said Gentilozzi. "You have to define who you are, what your product is. But the idea of trying to out-star them in the U.S. isn't going to happen."

I pointed out that the drivers I named above have an international following. NASCAR is more of a domestic product. If Champ Car wants to be an international product or global product, then it needs drivers who have a global name.  Montoya has a global name, Scott Speed does, so on and so forth. AJ. Allmendinger was actually beating Bourdais. There's a guy, American, beating Bourdais on a regular basis, and he got away from Champ Car. As owners of the series, at what point do you step up and say, We're going to commit to these certain athletes to be our stars of the future and whatever it takes we're going to get 'em?

"You can't have whatever it takes," said Kalkhoven. That's not going to work. I mean, there is no way that -- if somebody wants to buy somebody, has resources to be able to do it, they will. It's as simple as that.

"However, I think what you're going to find, and time will tell, is that lack of success that these people will have.

"Not to pick on A.J., because I like A.J., said Gentilozzi, "but that was a tactically terrible mistake. His teammate is qualifying in the top half of the field and he's doing bench presses on Sunday.

But the flipside is, how did that work out for Champ Car that a potential star was lost to the series?

"If any of us think that Toyota has any conscience or limit on their checkbook are kidding themselves.  The damage they're going to do long-term to NASCAR is going to be significant. But somewhere in a go-kart race in Phoenix there's another A.J. Allmendinger," said Gentilozzi.

Certain key drivers you want to base your sport around -- every sport has their stars, I pointed out.   Who are going to be the stars of Champ Car?

"Well, Champ Car's invested big in Graham Rahal. I mean, we've really gone out on a limb to make Graham a name everywhere we can."

He's talking about Formula One, though.

"I talk about Formula One. Doesn't mean anything," said Gentilozzi.

"Look at Rubens Barrichello. I know Rubens well. He went from being a Ferrari driver to a driver you don't hear of. Rubens is a guy, okay, pretty big name around the world, been a Ferrari driver. He'd come for $5 million because that's what he's getting paid to drive that shit box."

"The point, guys, you've raised a good point," said Kalkhoven.  "Who are we going to build on? We have to rebuild. I don't know that we can get out and hire a big name. I just don't. 'Cause we've looked at it."

"Between today and tomorrow, there will be five or six Formula One guys, test drivers in Formula One here, looking for a ride in Champ Car. None of the ones you talk to are shy at all about saying, We'd much rather come race here than wait for the day that won't come over there," Gentilozzi pointed out.

"We need to be looking at the best drivers in the world that we can get. That means -- I mean, in this case, he talked to Timo the other night. Timo is now in the lead of the GP2 championship. He thinks he's going to get a ride. If he doesn't, he says, I want to come back where I can race, because he loves racing in GP2.

"It doesn't matter where they're from, we just need the best drivers. And I think we've got a great field. I mean, look at all the young talent this year.

"Gommendy, all these young guys. We've got a great mix. I think that we're going to be prepared next year probably to lose a couple of our senior drivers because they can't get it done."

"But also look at the great field of Atlantic drivers that we have. Are we cultivating? Yes, we're cultivating the drivers. We're cultivating the team owners, the crew members. That is the development series to step up for everybody into Champ Car," said Johnson.

"Are we in discussions? Yes, we're in discussions with potential new teams on a daily basis. Am I going to sit here and tell you how many cars? No, I can't. Unfortunately, I made that mistake last year so I'm not going to do that again.

"Would we love more American drivers? Yes. We can't guarantee we're going to get them. We're going to get the cream of the crop. Look at the Atlantics. There are some kids that could step up."

"One of the criticisms leveled against Champ Car a few years ago, two or three years ago, was the drivers weren't good enough to go to Formula One," said Kalkhoven. "I remember reading certain journalists saying, Champ Car drivers aren't good enough to go to Formula One. And now when they go to Formula One, we're told that's bad.

"I mean, the reality is they're going to move between series. They always have done. I'm actually kind of looking forward to next year. I think we will see young Graham, as he takes over the No. 1 role in Newman/Haas, I think you'll see a real developing star. We'll wait and see."

Moving off drivers and move it to the thing that fuels the sport, which is money? Where, bottom line, where do you see the series attracting sponsorship money?

"It's clear, when you look, that there is a very warm reception for the series and its drivers. It's also relatively clear, when you just look at the level of marketing activity that, for instance, the promoter has done here, the promoter has had no difficulty in selling sponsorship," said Kalkhoven.

"It's going to be a profitable race. When you look at the level of potential European sponsors, we've got a team with Minardi, sponsored by the Dutch. People tend to forget that Team Australia is actually a fully sponsored team, albeit with wine, which I think is excellent. When you see some of the things that will be happening, I'm sure you're going to see more international sponsorship. It's just an inevitability."

"Why is the CEO of Holmatro, product made here, spending all of his budget on racing in America, like even before it came here? The attractiveness, I think, for Champ Car in the rest of the world is, that it is American," said Gentilozzi.

"They're still curious about it. We're different. We're not GP2. Our cars are faster. We're not a support series for anybody. We're not the little guy. A lot of the world feels, even though those inside understand the difference with Formula One, a lot of the world feels it's just as good and, in fact, some ways better because we don't have the disparity of the class system that has so traditionally been in place.

"I was just talking to a young driver's manager. He said, My driver has given up the idea of coming to Formula One because if you don't get those six seats then you're just dirt. He used the word "dirt." In Champ Car, doesn't matter who you are. Y'all got the same stuff.

"We fought hard. It wasn't an easy fight to get quality in engines and cars, sit on the rules, people piss, moan and bitch."

"This year, the teams in Champ Car have spent 15 million bucks converting to new cars," added Kalkhoven. "That's a huge number. Could we have kept our Lolas, maybe had another car? For sure we could. But that wasn't going to let us grow.

"So we bit the bullet. We spent $15 million, got a new car that everybody pissed and moaned about, everybody criticized. In the end, it's a great race car. They're equal in competition. The tech staff and the Champ Car staff have done a great job at making it good.

"When was the last time we had a failure on a part? I love the guys who criticize -- there's a couple journalists who criticize the Panoz all the time. We should have done this, we should have done that.

"In fact, we got a great bargain, a great performing, safe race car. We hit our target. We haven't hit every target, but we hit that one.

"We all made mistakes. We all know that. But we're learning from those mistakes. It's hard to get into Asia, but we'll do it. We've learned that Europe really likes us, so we'll push on that. We've learned that there are other parts of the world, as Formula One departs, that have a great interest.

"And we've also learned, frankly, that they actually like the American approach to it. They like the open paddock. They like the accessibility of the drivers. They like the fact it's American. I mean, we tend to sometimes think that, you know, Formula One, because it's European, is the most sophisticated, all the rest.

"Talk to the people again. Why are these sponsors here? You'll find they like the American -- they like the fact we're American. They like the friendly approach. They like the accessibility of the drivers. And actually in a strange sense, you look at some of the stuff out there, there are Harley Davidsons out there.

"There is still a feeling about America that is positive. Because of other political issues, we tend to forget. When it comes down to it, people like American drinks, they like American television, they like American movies, they like American."

We then asked Kalkhoven, why not just come right out and say your Mission Statement is to become a true global world series?

"Until we have a schedule that's absolutely solid, until we know that the FIA approves it, we are not ready to make the  -- because when you play international, you're playing to a different set of rules. The schedule itself will make that statement. You can follow it up.

"I'm not going to be here, nor is anyone else, going to make a statement till we've got an international schedule that works."

But even if it's not next year, if your goal is to become a true World Series, that message needs to be hammered out over and over and over again we added. Fans need to know it around the world, promoters, drivers, everyone involved.

"I think drivers do. I think a lot of the promoters do. But the proof of the pudding is going to be when we actually have a solid schedule that is international with international sponsors. We've got good international drivers. For too long I think we've had the ability to overestimate some of the things that we said we'll do," said Kalkhoven.

"They're hard. Getting into China is hard. Getting into Korea was clearly hard. A lot of these things are hard and we've made mistakes. But our commitment is still there to do it. But we have to back up that commitment with solid facts this time.

"You guys have seen the evolution of what we've done. We've come a long way and we've made mistakes, but we have come a long way. And I think '08 will prove to be another step forward.

"Some of the things we've done are really, really hard. We talked about Asia. We talked about the car. I remember people saying, you know, after our first race in Vegas, you know, The car is a piece of shit. It will never work. It's going to be unreliable. They went on and on and on. Look at those times out there. I think it's actually -- if you exclude Sebastien, I think the first 12 cars are within a half of a second of each other."

"And look at the different winners we've had this year. The cars have been remarkably reliable. A lot of people said, Why are you doing it? What's wrong with the Lolas? Why are you spending that much money?"

"We all recognize our marketing has to be better."

Is the Las Vegas race going to be okay we asked?

"Again, you're going to have to wait for the schedule. But I don't see a problem with that one," said Kalkhoven.

"They're good guys. They're smart businessmen. Before the train wreck (Phoenix), if you have a chance to prevent it, let's prevent it.

"A lot of this goes back to the schedule. A lot of it -- I mean, there was always a certain element of criticism about having a season that ran from here to out there. So, you know, we're going to submit our schedule to the FIA. We're going to see how it all works out.

"But I think, to be really positive about this, we've taken some big gambles that have worked. We've taken some that haven't. I think when you see what has happened here in Assen, when you see the cars, and you realize that fundamentally we've also got a budding new star in Graham, things are actually pretty okay.

"Now, we have to perform for next year. But I think they're pretty okay. If you want to look at the glass half full, you can see a glass half full."

You guys are still committed? There are predictions out there that you guys are going to get tired of doing this, I pointed out.

"Any time anyone wants to ask me that question, I will respond to it the same way. We are committed. We have to do better," said Kalkhoven.

"You know what happens, this is a little earlier than the normal, The Sky is Falling," said Gentilozzi. Every year something happens that spins everybody up. It spins through the media, spins to some team owners. Then, geez, the whole thing is falling.

"That's because you have factions in the United States, like NASCAR and IRL, that want to see you dead.

"It's mostly marketing. Global marketing. It's one thing to market in America, where you live every day, you're there every day. It's easy. To now become a World Series and market in all these countries, like Formula One does, you're talking about a many magnitudes higher budget. From a marketing perspective is what I'm getting at.

"You can't buy the marketing. The marketing has to come from the guys in the press room," said Gentilozzi.

"Formula One has 400 journalists that go to every race.   Bernie [Ecclestone] doesn't spend a whole lot on marketing.  When was the last time you saw an F1 ad? Never."

That's the real answer. Formula One not only has 400 journalists, but when a promoter is spending $30 million on a sanction fee, they are putting in -- and $130 million on a track, they put in a huge amount of effort into activation in the local market because they have to," Kalkhoven pointed out.

"Internationally the heavy lifting is done by the promoter, not by the series. That's always been the case. So we find good promoters. We work with them. They put the money in. They do it country by country and do a really good job.

"We had a great promoter, we still actually do, in China, prepared to put in a large amount of money to make it happen. But we got it wrong.

"The heavy lifting in non-U.S. markets, that's really the only way you can do it. You can have an office here, but you're still not going to do the heavy lifting. Maybe we should have an office here, but that still isn't going to make a substantial difference in whether or not we should have a race in Bulgaria.

"The reality is in motorsports, and you know this as well as I do, Formula One, for instance, the promoter does the heavy lifting and always has done. There is no big international marketing program for Formula One. It's always done by the promoter because they know the local companies, they know the local economy, and they know the local businessmen.

"Here is an anecdote, very funny. We go into St. Petersburg last Sunday, the day of the Zolder race. We get in there and I switch on the television. Being me, I'm flipping through the channels. The third channel I flip to, there's our race. Now, I don't know how many people are watching at midnight in Russia, but it was there, and it was around Russia," said Kalkhoven.

We've seen the Denver race go into some sort of limbo.  We've seen the Phoenix race for a variety of reasons, probably largely scheduling, but it does cost a lot of money to put on a street race. Can you talk about this concept of the street race festival changed to a point where maybe it's not quite the central focus of the series the way it might have been in the past and that point of the right time and the right race?

"Did you actually look at our schedule in the past? We don't actually have, never have had, a majority of street races. So there's a perception there we're a street race. It's not factually true. We've always had a balance between different types of road racing, if you like, turning right as well as left.

"And certainly they are hard to put on. But based on my experience in things like Long Beach, which is now back to the year 2000 attendance numbers, you can make them into great events. That's what we talk about, we talk about the events, not about street races.

"Let's look at we're not a street racing series, never have been. The majority have always been non-street races."

"Somebody wrote that we were in negotiation with the IRL to leave the month of May open," said Gentilozzi I think it's an Indianapolis-based journalist who shall remain nameless. The word they have in England is poppycock or something like that. It's not entering into our schedule [a May Indy 500 gap]."

"I can absolutely tell you that no one in Champ Car management or I or Paul or Dan or Jerry have had any conversations with the IRL in a year," said Kalkhoven. "Anything else you may hear is a fairytale. Now, were there other people who would still like to put it back together? And are those people frustrated because it won't come back together? Yes. But they're not in this room."

I asked, What is the top three priority things for you for the series, that you want to accomplish?

"Schedule, television, both domestic and international, improving it, and commercial success, sponsors," said Steve Johnson

Will there be a series sponsor in 2008?

"That's the tough one. We are working towards that. I am not going to jinx anything right now. That is front and center and something that we got several folks on right now," said Johnson

"The biggest mistake we could have done was not to try to do things, change. In so doing, you make a mistake every now and then. But the biggest mistake would have been not to try," said Kalkhoven.

The author can be contacted at markc@autoracing1.com

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It's time for CART to define its own future

Key upgrades at Road America

Back-Breaking work

The rebirth of CART

The hidden costs of Indy Car racing

CART's road and street circuits are clicking with the fans

Is it sport, or a P.T. Barnum show?

IRL at Fontana - a victim of friendly fire

CART's 2003 race venues #1 in the world

Meet the Gonzalez brothers

ISC is making enemies in Miami

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